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Munich. After another strong performance in the first half of 2017, the
BMW Group remains fully committed to implementing its
Strategy NUMBER ONE > NEXT with the ultimate
aim of shaping the mobility of the future and the transformation of
the automobile sector. As the world’s leading provider of premium
mobility, the BMW Group always focuses on the needs and desires of
its customers and is continuing its ground-breaking work on the four
ACES topics (Autonomous,
Connected, Electrified und Services/Shared).

The Group's primary focus is on expanding electric mobility and
automated driving. The BMW iNEXT will set new
standards in both of these fields and will act as a technological
spearhead. It will be manufactured at Plant Dingolfing from 2021,
underlining the significance of Germany for future technologies and
as a centre of competence for electric mobility. Germany will also
serve as a key location for the development of autonomous driving.
As part of the co-operation arrangements established with Intel and
Mobileye, the first engineers from all three companies will move to
the new development campus in Unterschleißheim near Munich in the
course of the current year. Moreover, one year since the
co-operation began, a number of other prestigious partners including
Delphi and Continental have also joined the project.

“Huge changes lie ahead in the world of mobility and it is vital
that our company is in top shape to tackle them. Strategy
NUMBER ONE > NEXT sharpens our innovative edge and
strengthens our core business,” commented Harald
Krüger, Chairman of the Board of Management of BMW AG. “We
are advancing rapidly in the field of electric mobility, today and
into the future. No established competitor has been able to put as
many electrified vehicles onto the roads as we have. In the future,
our flexible architecture will enable us to decide quickly which and
how many models to build with combustion, plug-in hybrid or
all-electric drive systems. This flexibility in our product range is
our key to success in times of volatility and uncertain forecasts.”

A successful core business, geared to generating long-term
profitability, remains the backbone of the BMW Group, providing the
underlying strength to determine the shape of mobility going
forward. The BMW Group recorded growth in the second quarter 2017 in
terms of volumes, revenues and earnings. This performance was
boosted by the new BMW 5 Series, the launch of
which in early 2017 marked the start of the largest model offensive
in the BMW Group’s history. Forty new and updated models of the
Group’s three premium brands, BMW, MINI and Rolls-Royce, will be
brought to market during the current and the following year.

“Our customers are excited by the new 5 Series model. Since its
market launch and throughout the second quarter it continues to
achieve considerable market success. We are confident that the BMW
Group, with its three premium brands, will set a new record for
deliveries to customers in 2017 and remain the foremost provider of
premium mobility,” said Krüger. “Together with the
success of our products, our strategy of focusing on profitable
growth in the USA is also paying dividends.”

The model offensive also extends the upper-premium segment.
Through the targeted addition of vehicles with great emotive appeal
– such as the new BMW 8 Series – the BMW Group aims to achieve
significant volume growth in this segment by 2020. The segment also
includes the BMW 7 Series and the future BMW X7. In addition, the
BMW Group is raising the bar in terms of profitability in order to
ensure its long-term business success.

“Sustained profitability is and remains an integral part of our
Strategy NUMBER ONE > NEXT, ensuring we have the necessary
resources to take on the challenge of shaping the future of
mobility,” stated Nicolas Peter, member of the BMW
AG Board of Management responsible for Finance. “This is why we are
focusing on the needs of our customers and the relevant technologies
of tomorrow. Using our corporate values as the starting point, we
ensure our structures enable future-oriented, cooperative ways of
working, while setting clear priorities for the allocation of our
resources. We are deliberately reducing the degree of complexity in
our products and processes. We always act with foresight, a steady
hand and from a position of strength, as we never lose sight of the
long-term strategy and sustained success of the BMW Group as a
whole. This combination of constancy and dependability is the
hallmark of the BMW Group and will remain so in the future.”

The BMW Group’s broad range of electrified vehicles was
particularly popular during the first six months of the current
year. Deliveries of BMW i3 and i8 models, the BMW iPerformance
plug-in hybrids and the new plug-in hybrid version of the MINI
Countryman totalled 42,573 units, some 80% up on the previous year
(2016: 23,681 units). “We remain firmly on track to deliver more
than 100,000 electrified vehicles for the first time in a single
year,” Krüger stated.

Since the market launch of the BMW i3 four years ago, the BMW
Group is a pioneering force in the world of electric mobility and
clearly remains on this course. Including the first MINI brand
plug-in hybrid model, the BMW Group now offers nine electrified
vehicles, with the new BMW i8 Roadster set to
further increase that number in 2018. Shortly afterwards,
all-electric, battery-powered e-mobility will become an integral
part of the BMW Group's core brands, starting with the production of
an all-electric, battery-powered MINI at the Group's plant in Oxford
at the end of 2019 and followed by the all-electric, battery-powered
BMW X3 in 2020.

BMW Group achieves volume, revenue and earnings growth

Deliveries of BMW, MINI and Rolls-Royce brand vehicles in the
second quarter 2017 rose by 4.6% to 633,582 units
(2016: 605,534 units). Group revenues between April
and June went up by 3.1% to € 25,799 million (2016: € 25,014
million). Profit before financial result (EBIT)
amounted to € 2,929 million, 7.5% up on the previous year’s figure
(€ 2,725 million). Profit before tax (EBT) grew to
€ 3,055 million (2016: € 2,798 million; +9.2%), resulting in an
EBT margin for the Group of 11.8% (2016: 11.2%).
Net profit rose by 13.6% to € 2,214 million
(2016: € 1,949 million).

Deliveries in the first half of the year
increased by 5.0% to 1,220,819 units (2016: 1,163,139 units).
Group revenues grew by 7.4% to € 49,247 million
(2016: € 45,867 million). Profit before financial
result (EBIT) climbed by 7.6% to € 5,575 million (2016:
€ 5,182 million). Profit before tax (EBT) for the
six-month period amounted to € 6,060 million (2016: € 5,166
million), 17.3% up on the previous year, boosted in part by a
positive valuation effect recorded in the first quarter. The
EBT margin for the six-month period came in at
12.3% (2016: 11.3%). Group net profit jumped by
21.5% to € 4,363 million (2016: € 3,590 million).

Automotive segment: EBIT margin within target range

At € 22,976 million, second-quarterAutomotive segment revenues were at a similarly
high level to the previous year (€ 22,872 million; +0.5%).
EBIT increased by 2.8% to € 2,238 million (2016:
€ 2,178 million), causing the Automotive segment’s EBIT
margin to improve to 9.7% (2016: 9.5%), which lies within
the unchanged target range of between 8 and 10%. Profit
before tax climbed by 4.7% to € 2,385 million (2016:
€ 2,277 million).

Automotive segment revenues for the six-month period grew by 4.8% to
€ 43,668 million (2016: € 41,686 million). EBIT
improved by 4.3% to € 4,109 million (2016: € 3,941 million), while
the segment EBIT margin came in at 9.4% (2016:
9.5%). Profit before tax increased by 16.3% to
€ 4,664 million (2016: € 4,011 million).

Deliveries of BMW brand vehicles worldwide totalled
1,038,030 units (2016: 986,557; +5.2%), surpassing the one-million
mark for the first time during a first half-year period. Volume growth
was driven by a variety of models including the BMW Group’s flagship
BMW 7 Series, and the BMW X-family models. More than 32,000 units of
the BMW 7 Series were sold during the period under
report, 26.9% up on the previous year. Deliveries of the BMW
X1 in the first half of the year jumped by 45.2% to nearly
137,000 units. The BMW X5 (nearly 90,000 units;
+10.6%) also recorded significant growth. Even in the months directly
affected by the model change, the new BMW 5 Series
was able to maintain its previous year’s high level, with deliveries
to customers during the six-month period exceeding 166,000 units
(-1.8%). The growing availability of the 5 Series is expected to
provide additional momentum during the remainder of the year.

Deliveries of 181,214 units in the period from January to June 2017
also represented a new record for the MINI brand
(2016: 174,898 units; +3.6%) in the first half of a year. Six-month
deliveries of the MINI Clubman totalled 29,867 units
(2016: 27,511 units; +8.6%), while the new MINI
Convertible saw volume growth of 30.3% to 18,699 units (2016:
14,354 units).

The Rolls-Royce brand, based in Goodwood, England,
delivered 1,575 units to customers during the first half of 2017
(-6.5%). The corresponding six-month period in 2016 had benefited
greatly from the launch of the highly popular Rolls-Royce
Dawn leading to particularly high sales. This basis effect
and the break in availability of the Phantom ahead of
the launch of the next generation of that model were the main reasons
for the year-on-year volume decrease. Despite ongoing and perceptible
uncertainties in the luxury sector in a number of regions, Rolls-Royce
continues to target long-term, sustainable growth.

In line with its strategy of achieving a well-balanced distribution
of sales worldwide, the BMW Group uses its highly flexible production,
sales and marketing structures to even out fluctuating demand between
individual regions.

In Europe, the BMW Group recorded volume growth of
2.2%, delivering 555,206 units in the first half of the year (2016:
543,270 units), despite the recent headwinds affecting a number of key markets.

Demand in Asia grew significantly during the
six-month period under report and the number of vehicles delivered
increased to 415,888 units (2016: 361,568 units; +15.0%), mostly due
to the Group’s strong performance in China. Deliveries of BMW Group
vehicles on that market grew by 18.5% to 293,572 units (2016: 247,817
units), mainly driven by the full availability of the BMW X1 and the
popularity of the new BMW 1 Series Sedan, designed exclusively for the
Chinese market.

Volume performance in the Americas region continued
to be held down by the contracting automobile market in the USA, with
deliveries in the six-month period falling by 2.5% to 217,530 units
(2016: 223,098 units). By contrast, double-digit percentage increases
were reported in the number of vehicles delivered to customers in
Mexico and Latin America during the period from January to June.

Motorcycles segment records highest delivery volume figure to
date

The Motorcycles segment performed extremely
well in the second quarter. Deliveries to customers
in the period from April to June rose by 12.3% to a new all-time
high of 52,753 units (2016: 46,966 units). Revenues
grew by 12.8% to € 696 million (2016: € 617 million).
Profit before financial result rose by 6.1% to
€ 104 million (2016: € 98 million), giving an EBIT margin of 14.9%
for the quarter (2016: 15.9%). Profit before tax
increased by 6.2% to € 103 million (2016: € 97 million).

During the first six months of the year, a
total of 88,389 BMW motorcycles and maxi-scooters were delivered to
customers (2016: 80,754 units; +9.5%). Revenues
grew by 10.0% to € 1,319 million (2016: € 1,199 million).
Profit before financial result increased by 19.3%
to € 229 million (2016: € 192 million), resulting in an EBIT margin
of 17.4% for the six-month period under report (2016: 16.0%).
Profit before tax improved by 19.4% to € 228
million (2016: € 191 million).

Financial Services segment remains on successful course

The Financial Services segment also continued to perform well
during the second quarter. In total, 468,603
new credit financing and leasing contracts (2016:
460,718 contracts: +1.7%) were signed with customers between April
and June. Including contracts with dealerships, a total of 5,307,296
leasing and credit financing contracts were in
place as of 30 June 2017 (31 December 2016: 5,114,906 contracts;
+3.8%). Segment revenues in the second quarter rose
by 8.3% to € 7,044 million (2016: € 6,505 million). Profit
before tax improved by 17.1% to € 589 million (2016: € 503 million).

In total, 934,237 (2016: 874,090) new contracts
were signed in the first half of 2017 in
conjunction with our financing and leasing business, up 6.9% on the
previous year. Six-month segment revenues grew by
12.4% to € 14,090 million (2016: € 12,537 million). Profit
before tax increased by 10.3% to € 1,184 million (2016: €
1,073 million).

Workforce numbers increased

The size of the Group’s workforce grew by 3.3%
year-on-year to stand at 127,680 employees as of 30 June (2016:
123,597). Skilled workers and IT specialists in
future-oriented areas, such as digitalisation and automated driving,
continue to be recruited.

Outlook for 2017: BMW Group forecasts new record figures

The BMW Group is confident of achieving its projected targets
for the current financial year – largely thanks to its strong
brands, its attractive product portfolio and the expectation that
international automobile markets will continue their generally
upward trend. These favourable factors are offset by high levels of
upfront expenditure for new technologies, intense competition and
rising personnel expenses. The global political and economic
environment is expected to remain volatile.

“We forecast slight increases, and hence new record figures,
for automotive segment deliveries and
profit before tax in 2017,” stated Krüger. “With
the first half-year now behind us, we are confident of achieving the
targets set for the full year. We can therefore begin the second
half of the year with cautious optimism. That said, we also continue
to expect higher expenditure over the course of the year in
connection with key technological and strategic projects on the one
hand and the roll-out of the largest model offensive in the history
of the BMW Group on the other. Other factors to bear in mind are the
politically volatile environment and high upfront expenditure for
electric mobility and autonomous driving.”

The EBIT margin for the Automotive segment in
2017 is forecast to remain within the targeted range of between 8
and 10 per cent. With its premium brands, the BMW Group is confident
it will remain the world's leading provider of premium mobility in
2017. Due to positive translation effects, the BMW Group now
forecasts a solid increase in automotive segment
revenues for the full year.

Forecasts for the current year are based on the assumption that
worldwide political and economic conditions will not change significantly.

* * *

The BMW Group – an overview

2nd quarter

2017

2nd quarter 2016

Change in %

Sales volume

Automotive

Units

633,582

605,534

4.6

Thereof: BMW

Units

534,585

507,814

5.3

MINI

Units

98,155

96,587

1.6

Rolls-Royce

Units

842

1,133

-25.7

Sales volume Motorcycles

Units

52,753

46,966

12.3

Workforce 1

127,680

123,597

3.3

EBIT margin Automotive
Segment

Percent

9.7

9.5

+0.2 %points

EBIT margin Segment Motorcycles

Percent

14.9

15.9

-1.0 %points

EBT margin BMW Group

Percent

11.8

11.2

+0.6 %points

Revenues

€
million

25,799

25,014

3.1

Thereof: Automotive

€ million

22,976

22,872

0.5

Motorcycles

€
million

696

617

12.8

Financial Services

€ million

7,044

6,505

8.3

Other Entities

€
million

1

2

-

Eliminations

€
million

-4,918

-4,982

1.3

Profit before financial result
(EBIT)

€ million

2,929

2,725

7.5

Thereof: Automotive

€ million

2,238

2,178

2.8

Motorcycles

€
million

104

98

6.1

Financial Services

€ million

588

529

11.2

Other Entities

€
million

8

12

-33.3

Eliminations

€
million

-9

-92

-

Profit before tax (EBT)

€ million

3,055

2,798

9.2

Thereof: Automotive

€ million

2,385

2,277

4.7

Motorcycles

€
million

103

97

6.2

Financial Services

€ million

589

503

17.1

Other Entities

€
million

23

46

-50.0

Eliminations

€
million

-45

-125

64.0

Income taxes

€
million

-841

-849

0.9

Net profit

€
million

2,214

1,949

13.6

Earnings per share 2

€

3.34/3.35

2.95/2.96

13.2/13.2

1 Figures exclude dormant employment contracts, employees
in the work and non-work phases of pre-retirement part-time working
arrangements and low wage earners

2 Earnings per share of common stock/preferred stock

The BMW Group – an overview

1st half year 2017

1st half year 2016

Change in %

Sales volume

Automotive

Units

1,220,819

1,163,139

5.0

Thereof: BMW

Units

1,038,030

986,557

5.2

MINI

Units

181,214

174,898

3.6

Rolls-Royce

Units

1,575

1,684

-6.5

Sales volume Motorcycles

Units

88,389

80,754

9.5

Workforce 1

127,680

123,597

3.3

EBIT margin Automotive
Segment

Percent

9.4

9.5

-0.1 %points

EBIT margin Segment Motorcycles

Percent

17.4

16.0

+1.4 %points

EBT margin BMW Group

Percent

12.3

11.3

+1.0 %points

Revenues

€
million

49,247

45,867

7.4

Thereof: Automotive

€ million

43,668

41,686

4.8

Motorcycles

€
million

1,319

1,199

10.0

Financial Services

€ million

14,090

12,537

12.4

Other Entities

€
million

3

3

-

Eliminations

€
million

-9,833

-9,558

-2.9

Profit before financial result
(EBIT)

€ million

5,575

5,182

7.6

Thereof: Automotive

€ million

4,109

3,941

4.3

Motorcycles

€
million

229

192

19.3

Financial Services

€ million

1,192

1,120

6.4

Other Entities

€
million

12

23

-47.8

Eliminations

€
million

33

-94

-

Profit before tax (EBT)

€ million

6,060

5,166

17.3

Thereof: Automotive

€ million

4,664

4,011

16.3

Motorcycles

€
million

228

191

19.4

Financial Services

€ million

1,184

1,073

10.3

Other Entities

€
million

19

44

-56.8

Eliminations

€
million

-35

-153

77.1

Income taxes

€
million

-1,697

-1,576

-7.7

Net profit

€
million

4,363

3,590

21.5

Earnings per share 2

€

6.59/6.60

5.44/5.45

21.1/21.1

1 Figures exclude dormant employment contracts, employees
in the work and non-work phases of pre-retirement part-time working
arrangements and low wage earners

With its four brands BMW, MINI, Rolls-Royce and BMW Motorrad, the BMW
Group is the world’s leading premium manufacturer of automobiles and
motorcycles and also provides premium financial and mobility services.
As a global company, the BMW Group operates 31 production and assembly
facilities in 14 countries and has a global sales network in more than
140 countries.

In 2016, the BMW Group sold approximately 2.367 million cars and
145,000 motorcycles worldwide. The profit before tax was approximately
€ 9.67 billion on revenues amounting to € 94.16 billion. As of 31
December 2016, the BMW Group had a workforce of 124,729 employees.

The success of the BMW Group has always been based on long-term
thinking and responsible action. The company has therefore established
ecological and social sustainability throughout the value chain,
comprehensive product responsibility and a clear commitment to
conserving resources as an integral part of its strategy.